Sales surge in bid to beat VAT rise

Millions of pounds areset to go through the tills as the public tries to take advantage the last eight days of the current VAT rate, which goes up by 2.5 percentage points to 20 per cent on 4 January.

A raft of big names, including Harvey Nichols and Debenhams, today open their doors for the Boxing Day sales.

Leading retail analyst Nick Bubb of Arden Partners said this week would be "absolutely massive" in terms of the amount of money taken at the tills.

"It will be huge," he told Scotland on Sunday. "The VAT rise will accelerate a lot of sales. All of the VAT promotions will be on television and in the newspapers and given the pent-up demand (from before Christmas] anyway, it will be massive."

The sales boom is expected to benefit retailers selling "big ticket" items such as fridges and sofas, and electronic shops in particular as households seek to make big savings ahead of the VAT hike.

For many the shopping spree started yesterday, when online bargain hunters interrupted their Christmas dinners to take advantage of the massive savings on offer in the first day of the internet sales.

Gordon Drummond, the general manager of Harvey Nichols store in Edinburgh, said: "We always start our sales on Boxing Day - and it is one of the busiest days of the year for us.

"We normally take as much on a Boxing Day as we might take on a quiet week in February."

Drummond said as many as 700 bargain hunters were expected to queue outside the St Andrew's Square store to net designer labels such as Gucci, Burberry and DKNY.

Meanwhile, the Scottish National Party yesterday called on the UK government to delay the hike in VAT next month to ensure businesses and the economy can recover from the effects of the severe winter.

Snow prevented shoppers getting to stores and staff getting to work in some parts of Scotland in the past month.

The SNP said businesses had faced serious problems and the Scottish economy could take a hit of 2 billion.